Journal article

The Effects Of The Coverage Gap On Drug Spending: A Closer Look At Medicare Part D

Yuting Zhang, Julie Marie Donohue, Joseph P Newhouse, Judith R Lave

HEALTH AFFAIRS | PROJECT HOPE | Published : 2009

Abstract

We calculated prescription drug usage in two groups of Medicare beneficiaries: employer group with no coverage gap, and individual Part D group with no coverage or some generic drug coverage in the coverage gap. Among those with employer coverage, 40 percent reached the doughnut hole, compared with 25 percent of those without such coverage. Overall, 5 percent went through the doughnut hole to reach the catastrophic coverage level. Those lacking coverage in the doughnut hole reduced their drug use by 14 percent; those with generic coverage reduced their use by 3 percent. Coverage of generic drugs with a $0-$10 copayment in the doughnut hole could be financed by, at most, a six-to-nine..

View full abstract

Grants

Awarded by National Institutes of Health (NIH)


Awarded by NATIONAL CENTER FOR ADVANCING TRANSLATIONAL SCIENCES


Awarded by NATIONAL CENTER FOR RESEARCH RESOURCES


Funding Acknowledgements

Joseph Newhouse's research was supported by the Alfred P. Sloan Foundation. He is a director of and holds equity in Aetna, which sells Part D policies. Julie Donohue gratefully acknowledges financial support from the National Center for Research Resources, a component of the National Institutes of Health (NIH), NIH Roadmap for Medical Research (Grant no. KL2RR024154-01). The University of Pittsburgh Institutional Review Board approved this study. The study design and analysis were done by the authors.